Self-funding is an effective financial tool employers use to manage employee health plan costs. It allows flexibility in plan design and lower overall expenses, as well as tax and legal advantages typically not found in fully-insured employee benefit plans.
Employers purchase Medical Stop Loss Insurance for protection against individual catastrophic claims and/or a high frequency of smaller claims. The type and level of Medical Stop Loss Insurance purchased should reflect the employer’s size, cash flow and risk tolerance.
Spectrum offers a variety of Medical Stop Loss Insurance products for single employer groups with 25 to 199 employee lives. Total paid claims experience is required on all currently self-funded groups, as well as all fully-insured groups over 100 employee lives. Fully-insured groups of 25 to 100 employee lives must provide total paid claims experience when available; when unavailable, manual stop loss proposals can be issued.
Specific Stop Loss – Protection against catastrophic claims in excess of an individual specific retention on each plan participant.
- Minimum Specific Retention: $10,000
- Lifetime Maximum: Unlimited (lower limits available)
- Contract Basis: 12/12, 12/15, 12/18, 12/24, 15/12, 24/12 & Paid
- Coverage: Medical (standard); Rx (optional)
- Specific Advance Reimbursement: Standard
- Aggregated Specific Retention: Optional
- Specific Terminal Liability: Optional
- “No Laser Renewal / Renewal Increase Maximum”: Optional
Aggregate Stop Loss – Protection against a large accumulation of total claims below the specific retention and in excess of an annual aggregate retention.
- Standard Attachment Point: 125% of expected claims
- Aggregate Limit (25 to 100 employee lives): $2,000,000
- Aggregate Limit (101 to 199 employee lives): $1,000,000 ($2,000,000 available)
- Contract Basis: 12/12, 12/15, 12/18, 12/24, 15/12, 24/12 & Paid
- Coverage: Medical (standard); Rx, Dental, Vision and WDI (optional)
- Monthly Aggregate Accommodation: Optional
- Aggregate Terminal Liability: Optional
Integrated Stop Loss – Protection against claims in excess of a monthly integrated retention covering claims on all plan participants.
- Integrated Aggregate Limit: Unlimited
- Claim Limit Per Participant: Unlimited (lower limits available)
- Contract Basis: 12/12, 12/15, 12/18, 12/24, 15/12, 24/12 & Paid
- Coverage: Medical (standard); Rx, Dental, Vision and WDI (optional)
- Integrated Terminal Liability: Optional
